Govt to resurrect SUUTI

OUR SPECIAL CORRESPONDENT

New Delhi, Jan. 9: The government today decided not to wind up the Specified Undertaking of UTI (SUUTI) for the time being, paving the way for the sale of its holdings in three companies — ITC, L&T and Axis Bank.

“The proposal of the finance ministry (with regard to the SUUTI) has been approved,” information and broadcasting minister Manish Tewari told reporters after a cabinet meeting.

In March 2012, the cabinet had cleared a proposal to wind up the SUUTI and create a National Asset Management Company.

The SUUTI holds an 11.54 per cent stake in ITC, 23.58 per cent in Axis Bank and 8.27 per cent in Larsen & Toubro, valued at around Rs 40,000 crore

The finance ministry hopes the stake sale in the trio will help it to balance its books.

Divestments in many companies are stuck because of opposition by the administrative ministries and unions.

Axis Bank was last month allowed to raise its foreign direct investment limit and is looking to buy a stake from the market. However, a stake sale in L&T or ITC involves regulatory issues.

BSNL and MTNL

The cabinet committee on economic affairs today accepted loss-laden, state-run BSNL and MTNL’s offer to surrender their 4G spectrum against the refund of the fees paid to get these lucrative airwaves.

Officials said the government would make staggered payments to both the state-run telecom giants, with BSNL receiving Rs 6,724.5 crore and MTNL Rs 4,534 crore. The government could then auction the spectrum obtained from the PSU duo.

Both the PSUs have said that they are not in a financial position to launch the high-speed 4G services.

BSNL and MTNL are expected to use the refunds to pay their huge debts. MTNL is believed to have an outstanding debt of Rs 8,477 crore, while BSNL has loans worth Rs 2,561 crore. The PSUs have been bleeding for some time because of a delay in buying equipment and heightened competition.

Edible oil

The government has increased the import duty on refined edible oil to 10 per cent from 7.5 per cent to protect domestic industry and farmers. The move is expected to fetch Rs 600 crore revenue to the exchequer.

The import duty on crude edible oil is 2.5 per cent and refined edible oil, 7.5 per cent. As the duty difference is only 5 per cent between the two varieties, traders have resorted to higher import of refined oils, thereby affecting domestic refiners and farmers.

India produces 9 million tonnes of edible oil, while the consumption is around 20 million tonnes.